Drive $500 car until in breaks - repeat

[Goshawk]

Here is an interesting REDDIT discussion about buying a cheap car. And just use it until it breaks. Kind of makes sense financially.

Considering just buying $500 cars and driving them until they break, rather than spending 15k on a late model




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[jimindenver]

I did it for a long time except it was buy the cheap vehicle and keep it going until either I couldn't fix it or it was cheaper to get another cheap car. I did have the transmission rebuilt on the 75 E100 only because everything else was in good working order at the time.

 

[Van-Tramp]

I was just talking about this yesterday and realized that of all the cars I have had in my life, my van is my 2nd most expensive purchase price at $3400. Only my 1992 BMW 325is was higher, and that was only $3900. All the rest were under $2000, many being under $1000. I got every penny of use out of them all. I never felt cheated or that I paid too much once it was dead or near death. Most I still sold towards the end of their lives for a return of some of the money put in. A few of which I even turned a profit. A few others I abandoned on the side of the road (towing cost was more than it was worth) and a few others I gave away to family members. In fact, that $3900 BMW was given to by nephew, who drive it for another quarter-million miles before he sold it (for over $3000) and it is still on the road today with more than a half-million on the clock.

I could/would never by brand new... ever. I could see myself buying a few-year-old vehicle after it's cost has depreciated to make it a good purchase. Still, I prefer vehicles pre-1996 as they can be worked on with a wrench instead of a laptop.

All of my $500 vehicles lasted only a year or two each, but consider that the average new-car auto payment for a single month is greater than $500, that is a great use of my money.

 

[ArtW]

That's been pretty much my whole car ownership experience, except the $500 car is now a pipe dream ,at $500 they're ALREADY broken, at least in this area
OTOH, I've been driving my $1600 Ranger for i think 3 years now, been to NC and back in it, done nothing but fluid maintenance and replaced a radiator cap and tires, it's been pretty reliable
Unfortunately, I'm seeing a drip under now that isn't condensation from AC, and so far I've been too busy to crawl under to look (and a bit scared, TBH)
AC works, but one of the windows doesn't (who cares, if the AC works lol)

 

[Trebor English]

The cash for clunkers program screwed up the low price used car market. A good $500 car now costs $1000.

 

[Richard]

A good $500 car now costs $1000.

Yeah, most people in that discussion who mention actual prices suggest that 2-3 thousand dollars is the new $500.

 

[Every Road Leads Home]

I bought my first new vehicle in 2004. An F150 4x4. I've been spoiled on new vehicles ever since, they just ride so nice, never have to worry about any issues. Prior to that I always bought the cheapest vehicles I could find and fixed them as needed. I'd be embarrased to admit how many new vehicles i've owned since. (I'm on my 5th)

That being said, i've sort of figured out a loophole in the car industry. I only buy vehicles with huge discounts from the manufacturer and dealer. This way no haggling is necessary and it takes care of the first few years of depreciation. My last truck was a 2010 Chevy Silverado. It was 13k off the MSRP, I paid 28k. I traded it in on a 2013 Silverado in 2013 and they gave me 22k. So it cost me 2k a year to drive it for three years. All my vehicles since 04 have a similar outcome, costing me somewhere between 2 and 4k a year to always be in a newer car. Blue book values don't account for what you actually paid, they start at the MSRP and depreciate from there. So by only buying cars with huge discounts, I get out of that heavy initial depreciation. People that pay the MSRP or even just a few grand off will take a much bigger hit trading it in every few years. I used to do a ton of mileage on my vehicles for work, so they'd all have between 80 and 100k on them when I traded them in in 2 to 3 years, all the cost of doing business really. Since being disabled I've kept the truck I had as it was already paid for. I'm now toying with the idea of buying a new Chevy Express to hit the road in. Dealer has them for 8k off MSRP at the moment.

 

[closeanuf]

Border states like Texas see most of their cheap cars heading south of the border.  You can see actual caravans of one vehicle pulling another one south all the time.

 

[DannyB1954]

The problem with cheap is you rely on luck. Anymore if it runs it will cost you $1500. If it soon dies, that is a lot of money to toss in the trash. I have done both, (new and cheap). I think the sweet spot is a three year old vehicle. I bought my 2005 Dodge Dakota in 2008. Still have it. Replaced the power steering pump, that was about it. It had 40,000 miles when I got it, now it is about 125,000. 9 years of good service and I think I paid $11k. At the time a new model of the same truck was going for closer to $30k, (club cab SLT 4wd, v8).

 

[bullfrog]

The biggest factor I have is distance you have to drive and the types of roads you drive on. If every place you need to go is close by and weather is good or public transportation available and you never drive more than 20 miles at 35 miles per hour you could get by with something with lots of wear that needs fluids every 100 miles. If every trip to the store or doctor is 225 miles each way you need a much better car. When I taught mechanics the first day quote from the bible "Come to terms with thy ass for it bears thee." was my favorite. From 1960 till 1980 American V8's were cheap and easy. In 1980 till 2005 Japanese cars could be bought with blown motors (usually because of timing belts) cheap and used motors were imported from Japan with 50,000 miles on them (emissions laws required they be replaced there) for less than $500. You could have a really good 5 year old car for less than $2500. Samurai's and Honda Civics standard trans were towable so we pulled several behind the motor home, used them five years (100,000 miles) and sold or gave them away. Tried to do Jeeps but transfer cases got to heavy for this old man and spent a lot of time on the side of the road due to strain of 500 mile trips on low geared drive trains. Bought a 2002 Toyota Camry with 60,000 miles for $6,000 (first year Toyota went back to a timing chain) in 2010, so far have put 60,000 miles on it with only starter, tires and oil changes. In 2013 bought a new basic Toyota Tacoma 4x4, so far 50,000 miles tires and oil changes. Basically I haven't had to work on a vehicle since 2006. The cars have held up because we don't go off road with them. The truck seems like it will take offroading but hate to use it while I still have an old VW Baja which the parts are getting to expensive to replace and don't hold up like original parts did. When I was young and able to do my own work Chevy and imported cars and trucks were simple and easy to fix. Now I'm old I just try to buy something that won't break!

 

[steamjam1]

I love $500 dollar vans that challenge you... :y first van was $800 and BOY that challenged me..:-D

 

[poncho62]

I'm 64 and have never had a new vehicle. Up until a few years ago, my most expensive car was $3500....usually it was $300-$500 beaters that I worked on myself. I once bought a $50 car, drove it for 3 years and sold it for $75. I have had some collector cars, bought cheap, rebuilt myself. I'm pretty handy.
We downsized our house 10 years ago, so I bought the wife a nice 3 year old minivan for $14,000..paid cash....still have it......also paid $4000 cash for my present pickup.
To me, a new car with payments is just a waste.

 

[MrNoodly]

Sometimes an old car can come in handy. Long ago, I worked with a guy who drove an old car. At least once a month he'd call in to say his car broke down and he'd be late for work. It turned out he was stopping for a quicky with his mistress on the way to work, and sometimes the quikies weren't quick. Then there was a period when his car "broke down" a couple of times a week. Those were cover for job interviews. And quickies. He confessed all this after he got a better job.

 

[eDJ_]

I used to work at a 24/7 Gas Station when I was a kid and one of the Boss's buddies worked this angle all the time.  He owned a Grocery Store and a Pizza shop and would find these crazy cheap Cars out of estate sales,
divorces,  and any number of distress liquidations.   He called them "Honey for the Money" work cars.  

The boss was always on him to do an oil change and take care of the car which he refused to do.  He intended to drive it for 6 months and only add oil and gasoline as necessary.  LOL   The boss keep telling him that if he would quit being such a #&& %@( * and put some money in the thing he could drive if for a couple of years and have a dependable car.   But he wouldn't do it.   He just tried to sell if for what he paid for it.   Thus a car to use for
minimum liability insurance, license plates, and gas & oil.   I think it was like a game with him. 

I always found it amusing that there were people who pursued their transportation needs this way.  If he did
suddenly need to get something for the car because of a failed battery or plugged up fuel filter...he would come to the boss for an old used battery.  When he did that he always brought a large de lux pizza with him and cold soda in an igloo cooler.  I guess so the boss couldn't cuss him with his mouth full.  (I once heard hims say he could make that $10 Pizza for about 50 cent)  

I can still hear my boss's muffled cursing after him as he drove off the driveway in his "Honey for the Money-mobile".  

 

[ArtW]

The problem with cheap is you rely on luck. Anymore if it runs it will cost you $1500. If it soon dies, that is a lot of money to toss in the trash. I have done both, (new and cheap). I think the sweet spot is a three year old vehicle. I bought my 2005 Dodge Dakota in 2008. Still have it. Replaced the power steering pump, that was about it. It had 40,000 miles when I got it, now it is about 125,000. 9 years of good service and I think I paid $11k. At the time a new model of the same truck was going for closer to $30k, (club cab SLT 4wd, v8).

Not luck, ability
Not just to fix the car if it breaks, but to pick one that's not about to break
Like any ability, it sharpens with use
My Uncle Mack sold used cars, and he would totally agree with you, a 3 year old cream puff is the best way to go.....if you can afford it
$300 bux a month for a car payment is far beyond what I spend in maintenance and repair on any of the cheap vehicles I buy, and oddly, when I have bought nicer, newer cars, they've actually cost me more to maintain than my older cars, because they, umm, broke more

 

[Spaceman Spiff]

It also depends on use.  I often find myself 20 miles up a single lane road, alone in the mountains.  Breakdowns there would be costly.  One needs to have the knowledge to fix it, have the tools to fix it, have the parts to fix it, know how to McGyver it, or have friends along that are willing to shuttle you for stuff or tow you out.

That strategy works in and near civilization, in the woods not so much.

I agree with Trebor English and Richard: I haven't seen anything (Minnesota) that could be inexpensively made reliably drivable for under $1500.  AND it is getting harder to find anything that doesn't have a lot of electronic controls in it.  Cash-for-clunkers really screwed up this market.

 -- Spiff

 

[Optimistic Paranoid]

Well, as I've posted before, I've spent the last 20 years, before I retired, driving back and forth to work in government surplus cars that were bought at government auctions.  Price was always between $2,000 and $2,500 dollars, mileage was usually around 80,000 to 90,000 miles.  They were always very well maintained.  The government honestly told you about any known problems, if any.  I would get 3 or 4 years out of them, and usually ended up scrapping them around 150,000 miles when things started going wrong.

 

[Gary68]

buy old $500 vehicle,fix it and drive it for a decade,i bought my 68 chevelle for $500 on blocks no motor/trans or rear end fixed it drove it for 15 years sold it for almost 10k,bought my chevy 4x4 for $800 fixed it been driving it for 10+ years,done it many times with older cars,anything newer is disposable,i wonder what the carbon footprint of a prius the gets scrapped after a decade vs a muscle car that has contributed nothing to scrap heap in 50 years

 

[slynne]

Years ago, when I was studying Economics, I came across a paper where the thesis was that buying a clunker for the cheapest price possible and then putting NO maintenance or repairs into it and just replacing it when it breaks along with the minimum PLPD insurance, resulted in the lowest cost per mile of any other form of private car ownership. My thought though was they weren't factoring in all the non monetary costs such as the hassle of breaking down, disposing of the vehicle, getting a new one, etc.

 

[poncho62]

Trouble is with driving clunkers these days is that in many areas you have to pass "E" tests.......thats why most of these traded in cars are scrapped rather than put back on the road.